ISAF, a Romanian company with more than 65 years of experience, became part of the Colas Rail Group since 2008, and is a specialised constructor for a large volume of investment works in railways and urban rail transport, electrification, signalling, telecommunications.
The company implements rail projects in Romania, Greece, Bulgaria, France and Morocco and is continuously focused to increase its presence on national as well as international markets.
Central and East-European Countries are in full process of railway modernisation, the infrastructure being the main element in establishing a performing transport system that will provide efficient services. Here, the European financing plays a vital role in the launch of new projects as the countries don’t manage to implement them without EU contribution.
With tens of rail projects financed, through the operational programmes 2014-2020, the countries begin to announce tenders and to prepare new projects to increase the capacity and quality of the infrastructure, and the level of integration in the European rail system, to contribute to the rail industry development.
Regarding railway transport in Romania, the European financing plays the decisive role in the implementation of projects. Under the programmes of 2014-2020 finnancial framework, Romania received around EUR 9.4 billion for the Large Infrastructure Operational Programme (LIOP), through both the European Regional Development Fund and through the Cohesion Fund. More than half of the total financing (including national co-financing) for LIOP – EUR 6.8 billion – is stipulated in the transport infrastructure, 37% in the development of the environment sector and 5% for the energy sector.
At the middle of 2016, the authorities, through the Ministry of European Funds, launched the financing calls for transport infrastructure development with a budget of EUR 5.8 billion, allocation included in LIOP, and financing demands for all calls could be submitted by December 2018. The total budget for the rail infrastructure and metro infrastructure call is EUR 2.53 billion, of which EUR 1.85 billion for rail infrastructure and EUR 682 million for the metro system development.
By submitting eligible projects, Romania will be able to create a performing rail infrastructure and contribute to the significant implication of the industry which requires the revitalisation of this transport sector.
One of the rail industry companies with intense activity in Romanian and foreign projects is ISAF.
Established in 1951, ISAF S.A. became part of Bouygues-Colas-Colas Rail Group in 2008 and since 2014, the company is part of the Colas Rail Europe Division. The company’s activity relies mainly on the execution and installation of electrification, signalling, communications and radiocommunication installations, as well as rail and urban rail high voltage installations.
With railway projects implemented in Romania and abroad, the company is permanently consolidating its activity to become a project leader. The rehabilitation of the Acharnes-Tithorea railway (Greece) and the rehabilitation of Athens catenary and power supply tram system (including the design, supply, installation and maintenance of 67.5 km of overhead line equipment for double track and 15 traction substations and SCADA), the rehabilitation and electrification of Dimitrovgrad – Harmanli railway (Bulgaria) are projects of major importance for boosting the performance of infrastructure in both countries. ISAF delivered these projects in time and within the budgets. ISAF’s important projects in Romania included the modernisation of Piteşti rail station (including the development of telecommunications, signalling and interlocking works), the rehabilitation of Arad tram system (by electrification of the double line – 5.9 km, with simple overhead line) and Bucharest tram project (Line 34, electrification of simple line – 3.63 km with simple catenary and overhead line).
In 2016, the company signed several contracts over EUR 22 mil. ISAF has a competitive advantage in the market due to its capacity of delivering design services, from basic design to construction design and also to its own manufacturing facility in Bucharest where railway components are produced for different fields: catenary, power supply, signalling, telecommunications. The company’s team provides technical support for construction sites and to other departments that need expertise.
With a young team, committed to delivering innovative and high-quality solutions, with vast experience in the railway market, next to Colas Rail’s 100 years of experience in the field, ISAF is constantly building its leader position on the markets where it is already present and is working to access new markets too.
In the interview below, Mr. Jacques Guillemot de Liniers, Managing Director ISAF Romania talks about new information on the industry dynamics and competitiveness, the role of the political class and of infrastructure companies in the launch of projects, the challenges the industry faces in contracting projects, as well as the company’s development opportunities and strategies.
For the EU countries, the last two years meant new debates on the financial grants for rail projects. As a result, new projects were submitted for financing and agreements were signed. What do you think about the allocation of financing to Central and East European countries? To what extent could you compare it to the financing granted to West-European countries?
Jacques Guillemot de Liniers: We are at different stages of development. Central and Eastern Europe is coming to the end phase of political and economic changes which have influenced the market economy. The EU financial aid was introduced to support the current developments happening now. Central and Eastern Europe is still in the process of post-war reconstruction while Western Europe experienced their major infrastructure developments in the 1970s. Today, aid is most needed in the region of Central and Eastern Europe and we look forward to starting new projects.
How do you estimate the dynamics of the railway industry in the two regions keeping in mind that the ECE countries are encouraged to invest massively in railways over the next period?
Jacques Guillemot de Liniers: We are aware of the shift in dynamics in the railway industry since the funding has been allocated. We are mainly focusing on the Romanian and Bulgarian markets. However, due to the current political instability, we are forced to wait on up-coming decisions regarding the change of government before being able to move forward. This is a slow moving process.
Given the opening of the market, infrastructure managers should become more dynamic and more focused on developing quality growth projects. From your point of view, is the liberalisation project a competitiveness growth and rail industry development factor?
Jacques Guillemot de Liniers: The development of quality growth projects is important, as is the harmonisation of technologies in order to optimise time and save money for the State.
In Central and Eastern Europe, how would you describe the implication of the political class and of infrastructure managers in launching new projects and encouraging rail industry development?
Jacques Guillemot de Liniers: This is a sensitive issue. The current political and economic instabilities in this region is the major cause blocking new project launches and the industry’s development.
ISAF has implemented projects not just in Romania, but also in Greece, Bulgaria, France and Marocco. What is ISAF’s strategy to consolidate these markets?
Jacques Guillemot de Liniers: For the time being, ISAF will concentrate its efforts on Romania, Greece and Bulgaria. We are focusing on the countries in which we have a strong presence. Having our own plant in Romania contributes to the stabilisation of ISAF allowing us to strengthen our business; also, this is offering us the flexibility to be involved in maintenance works projects and to consider subcontracting opportunities.
Since 2014, ISAF is part of Colas Rail Europe Division. After two years, what is the impact of this affiliation on ISAF’s activity and implication in international rail projects?
Jacques Guillemot de Liniers: Being part of Colas Rail allows you to participate in projects on a global level and in France particularly regarding the High Speed Rail lines (HSR). The introduction of the Europe Division gives us the benefit of being geographically closer to our counterparts, hence creating synergies which will allow us to work more efficiently together on tenders.
What is the company’s business development strategy? What are the latest markets targeted by ISAF and how are they characterised and approached?
Jacques Guillemot de Liniers: ISAF’s strategy is to re-shift the focus towards big projects, making that the essential element of the rail business landscape. Our goal is to take on the role of the leading contractor and less that of a subcontractor. We are aiming to penetrate the bigger markets in Bulgaria and Romania and will actively take part in responding to major tenders.
What can you tell us about the Romanian railway market since there is European co-financing for transport projects, including rail?
Jacques Guillemot de Liniers: Having a local presence is a real opportunity for ISAF to present itself as one of the more competent companies in the rail industry while the funding is there. And we now have the green light to pursue these projects!
Recently, CFR SA has announced that total investments in railway projects amount to RON 22 billion (EUR 4.7 billion) with financing sources such as foreign loans, state budget aids and own funds. How do you see the deployment of future projects keeping in mind that the development of the rail sector in Romania (as in other countries in the region) are still confronted with problems related to legislation, the authorities’ dedication to develop projects etc.?
Jacques Guillemot de Liniers: Only the State can control the deployment of future projects. When dealing with such important matters, we must ensure that the design is completed in order to avoid questions and/or requested adaptations which will lead to hurdles in the final stages of the tender process. However, I am confident that step by step these challenges will be overcome and that the future major infrastructure projects will be released in a better form.
What challenges do you think there are for the rail projects initiated by the authorities?
Jacques Guillemot de Liniers: The real challenge for the authorities is to open up the Romanian market as soon as possible allowing the major rail and road corridors to become the heart of the social and economic development of the Romania of tomorrow.
What are the challenges, as well as the opportunities of ISAF in carrying out rail projects?
Jacques Guillemot de Liniers: ISAF’s main challenge is to maintain activity as well as a competent staff pending these major projects. We have the skills and the materials. ISAF is ready. Patience is an ongoing challenge!
What is the development phase of ISAF’s ongoing projects in Romania and abroad? Also, what can you tell us about company’s future projects?
Jacques Guillemot de Liniers: Considering the weather conditions in the region, most of the projects are on hold; however, we are involved in design activities and also in installation projects in France and in the rest of the world (HSR in Morocco, currently and Tunis). Our ambition is to be part in the rehabilitation of the major infrastructure projects in Romania, both railway and underground. Part of this ambition includes the development of our production facility in Bucharest by securing recurring business and accessing other markets as well.
Pamela Luica is talking with…
Mr Jacques Guillemot de Liniers,